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Allentown, PA - Freshest New Home Sales Numbers Give Hints Market Decrease is Slowing

Posted on: Feb 06, 2012 09:10:45 AM

New home sales in the Allentown, PA market fell year-over-year in October, but the drop in percentage terms was an improvement from September 2011, suggesting that the market may be stabilizing. New home sales saw a decline of 15.4% from the year earlier to 44. This came after a 15.5% decline year-over-year in September.

A total of 499 new homes were sold during the 12 months that ended in October, down from 507 for the year that ended in September.

New home sales represented 7.7% of overall housing sales, less than the 9.6% of sales a year earlier. After dropping in September from a year earlier, sales of new and existing homes rose year-over-year in October.

Pricing and Mortgage Trends

In October, the average per-unit price of new homes slid by 12.3% year-over-year to $265,656. This decline is larger than the 1.1% decline in September from a year earlier.

The average mortgage size on newly sold homes moved south year-over-year in contrast to new home prices. Average mortgage size sank by 12.6% from a year earlier, settling at $199,168 in October. In September 2011, average mortgage size declined 9.7% from a year earlier. On aveage, the percentage of new home sale price that was being financed went from 75.2% of average price to 75.0% from a year earlier. This came after a 6.6 percentage point decline in September from the year earlier.

Other Market Trends

As a percentage of new home sales, attached unit sales have gained from last year while single-family home sales have dropped. Attached unit sales increased from 40.4% of all sales in October 2010 to 65.9% of sales in October 2011. Conversely, the share belonging to single-family homes fell to 34.1% of sales from 59.6% of sales.

There was a 10.8% fall year-over-year in the average unit size of newly sold homes to 2,203 square feet in October 2011. The average size of newly sold homes moved from 2,219 square feet in September 2010 to 2,602 square feet in September 2011.

Foreclosures and real estate owned (REO) sales did not look to be a burden on the market. Together, foreclosures plus REO sales made up 23.3% of existing home sales. They represented 28.4% in October 2010. The percentage of existing home sales involving foreclosures fell to 11.2% in October from 14.7% a year earlier while REO sales as a percentage of existing home sales slipped to 12.1% from 13.7% a year earlier.

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